News

Israel Hopes To Reclaim Share of Diamond Trade

Could Haredim Prove Answer to Low-Cost Producers?

By Reuters

(Page 3 of 4)

Tel Aviv — Israel has subsisted on larger, high-end stones whose owners pay more to have them manufactured close to home. But industry leaders hope to change that, in part because polishers in developing countries are demanding more money.

“I think we are there, more or less. With rocks of one carat plus, I think we are in a place where the (wage) gap doesn’t justify running to manufacture abroad,” said Sahar.

The GIA decision to open its lab in Israel was a first step. Manufacturers can now have their diamonds graded and evaluated in Israel rather than sending them to the United States.

“It’s critical for the growth, for the international branding of the export business, and we think that we’re a good partner to help the manufacturing grow,” GIA President and CEO Donna Baker told Reuters when the lab opened.

By cutting costs and allowing increased turnover, it will add between $30 million and $50 million a year to the industry.

NEW BLOOD

At the peak of manufacturing in the 1980s, there were 20,000 people cutting and polishing diamonds in Israel. That has dropped to about 2,000.

“There is no new manpower. Most polishers are 50 years old and up,” said Roy Fuchs, who owns a factory a few minutes walk from the exchange. “If they don’t invest and bring in new blood, there simply won’t be manufacturing.”

To make it happen, the industry realises it needs help, and for the first time, it is looking for assistance.

“It’s not easy. You need cooperation with the government,” said Udi Sheintal, the Israel Diamond Institute’s managing director. “Here in the middle of Ramat Gan, you don’t get incentives. There are only incentives for certain populations, like the haredi.”